Shopping around for a new home often starts with shopping around for the right mortgage lender. A lender will be your financial partner throughout your homebuying journey, so it’s important to choose carefully. Working with the right lender can mean the difference between getting a good interest rate, getting important questions answered fast, and getting into your new home in a timely manner.
If you’re looking to buy a home, here are five important features to look for in a potential mortgage lender.
Responsive & Communicative
Choose a mortgage lender that is responsive to your inquiries, listens to your needs, and explains what products and services are available without pressuring you into making a choice before you’re ready. Customer service is par for the course for lenders, so you should expect friendly service and relatively fast turnaround on important communications – whether that’s by phone calls, emails, or however you prefer to keep in touch. If you find yourself chasing a potential lender for follow-ups, consider looking elsewhere.
Transparent About Closing Fees
Closing fees are the fees that you pay to your mortgage lender when you buy a home. This may cover loan servicing, home appraisal, mortgage insurance and so on. Unfortunately, closing fees can be tricky to predict and may be intentionally hidden in contract jargon by unscrupulous lenders. Ask any potential lenders about closing fees and listen carefully to their answer. You want to work with a mortgage lender you can trust to keep you up-to-date about how each step of the mortgage process will affect your final cost.
Helpful in Securing Discounts
Homebuyers may be eligible for various discounts, rebates and incentives. The right lender should be able to explain what programs are available and help you apply for these. For example, the first-time homebuyer program at HUECU offers a number of benefits to first-time buyers including a 0.125% rate discount and a $500 credit toward closing costs. At the same time, be wary of lenders offering discount-rate mortgages where hidden fees emerge after you apply. Again: transparency is key.
Able to Offer a Range of Products
With so many banks, mortgage brokers, online lenders and more all looking to do business with homebuyers, it’s especially important in today’s homebuying landscape to understand what’s really on offer. Chat with any potential lender about what products are available and how these can be tailored to fit your unique needs. In general, a lender should be able to provide both fixed-rate and adjustable-rate mortgages, as well as special options such as jumbo mortgages for people with larger borrowing needs. Also remember that some lenders only operate in a specific geographic area – which may be smaller or larger than you expect. HUECU, for example, has mortgages available to buyers in not only Massachusetts, but also Connecticut, Maine, and Vermont.
Fast and Efficient, Without Cutting Corners
When you’re ready to buy a new home, you don’t want to wait! A good mortgage lender will work as fast as possible, without cutting any corners. Plan to chat with a potential lender about their turnaround time for not only closing, but also preapproval and appraisal as both of these steps can take a good amount of time. With the right lender by your side, you’ll be able to check all the necessary boxes with speed and efficiency and be on your way to moving into your new home.
Finally, Keep in mind that when it comes time to make an offer on a home, you will likely be asked to submit a qualification letter from a Lender. The lender you select needs to be a source trusted by both realtors and sellers. The strength of your offer could be in question if none of the parties are familiar with the mortgage company or question their integrity.